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CAPITALSTARS – MCX COMMODITY MORNING MARKET NEWS UPDATES – 7 JAN 2019

Morning-Commodities-Market-updates-1

BULLION:

Bullion counter may continue its last week upside momentum following comments by U.S. Federal Reserve Chairman Jerome Powell that the central bank would be patient and flexible in steering the course of interest rates. The Fed chairman on Friday sought to ease market concerns that the U.S. central bank was ignoring signs of an economic slowdown, saying he was aware of the risks and would be patient and flexible in policy decisions this year. Gold can test 31650 in MCX taking support near 31370 in MCX and silver can move further upwards towards 39500. U.S. employers hired the most workers in 10 months in December while boosting wages, pointing to sustained strength in the economy that could ease fears of a sharp slowdown in growth. Gold discounts in India widened to a two-month high last week as prices surged to a more than six-month peak and demand remained subdued due to New Year holidays. Chinese officials will meet their U.S. counterparts for trade negotiations starting later Monday, the first face-to-face talks of the year.

 

METALS:

Base metals prices may continue last week recovery on hope of trade deal between US and China this week. Copper can take key support near 400 and can recover towards 416. Zambia’s Konkola Copper Mines (KCM), majority owned by Vedanta Resources, suspended operations at its Nchanga mine following the introduction of an import duty on copper concentrates, the company said. Zambia, Africa’s No.2 copper producer, introduced new mining duties, increased royalties and plans to replace Value Added Tax (VAT) with a sales tax by April to help bring down mounting debt. Zinc can recover towards 175 taking support near 168. China’s steel and iron ore futures started the week firmly on Monday, buoyed by central bank policy easing and by hopes that talks could help end Sino-U.S. trade tensions. China’s central bank on Friday cut the amount of cash that banks have to hold as reserves for the fifth time in a year, freeing up $116 billion for new lending. Lead can take support near 134 and can face resistance near 138. Nickel can take witness further recovery as it can test 785. Aluminium can take improve further towards 131 levels taking support near 128 levels.

 

ENERGY:

Crude oil may trade in green as oil prices rose by more than 1 percent on Monday, lifted by optimism that talks could soon resolve the trade war between the United States and China, while supply cuts by major producers also supported the market. Financial markets were riding a relief rally on Monday on expectations that face-to-face trade negotiations between delegates from Washington and Beijing, due to start on Monday, would lead to an easing in tensions between the two biggest economies in the world. Crude oil can test 3400 while taking support near 3300. Despite the likelihood of a slowdown, crude future prices were being supported by supply cuts started late last year by a group of producers around the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC) as well as non-OPEC Russia. Natural gas may open in red as it can tumble lower towards 200 in MCX. The number of rigs drilling for natural gas in the United States remains unchanged this week at 198, data from oil services firm Baker Hughes showed on Friday. Horizontal rigs — the type most often used to extract oil.

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